Jobs Report Reveals a Lot about U.S. Economy—Mostly Not Good

AP Photo/Paul Sakuma3 Mar 2016

The Labor Department monthly employment report Friday will tell us a lot about the health of the economy—much of it not good.

Forecasters expect the monthly tally of new jobs to come in at about 190,000. That’s well below last year’s pace, and a figure significantly below that modest target would indicate the economy is at high risk of another recession.

Since the Obama recovery began, the economy has expanded at a paltry 2.2 percent annual pace, and factoring in recessions, the overall rate of economic growth has been only 1.8 percent since the turn of the century. Consequently, in recent years new jobs have been created at about half the pace of the Reagan years.

Consumers, the engine of all advanced economies, continue to spend, but the strong dollar is pinning down exports and cheap imports are battering U.S. manufacturers. Businesses are becoming increasingly skeptical about expanding in the United States, and giants like Ford and Carrier are moving facilities to more business friendly Mexico.

Troubles in China can only be blamed to a point. Its miracle was fueled by a cheap currency—and that has pulled down U.S. growth by destabilizing American manufacturing—but also by government banks that finance factories that run perpetual losses to sell coffee makers and the like to American consumers. Both the recent Bush and Obama administrations can be blamed for not taking the kind of tough measures against Chinese protectionism advocated by Donald Trump and liberal New York Times columnist Paul Krugman.

On trade, her proposed methods are vague and sound much like a continuation of Obama’s failed tactics. What’s more, her record as Secretary of State suggests the opposite. The U.S.-Korea Free Trade Agreement, implemented on her watch, has added $16 billion to the trade deficit and killed 130,000 jobs. And Obama similarly promised to get tough with China on a host of issues but simply failed to take tangible actions once in office.

We have heard a lot from Donald Trump about his views on getting tough on trade and immigration, but not much about pulling out and burning the roots of federal and state bureaucratic fiefdoms that are rapidly turning America into New France.

A paradise for the well-educated from top schools with access to power and the best jobs but dungeon of low wages, tedious work and government handouts for the rest of us.

Peter Morici is an economist and business professor at the University of Maryland, and a national columnist. He tweets @pmorici1.